- CFA Exams
- CFA Level I Exam
- Topic 7. Derivatives
- Learning Module 32. Valuation of Contingent Claims
- Subject 5. Black Option Valuation Model
CFA Practice Question
A put option on futures, based on the Black model, is a ______ component minus a ______ component.
B. bond; futures
C. futures; stock
A. stock; bond
B. bond; futures
C. futures; stock
Correct Answer: B
The futures component is F0(T) e-rTN(-d1) and the bond component is e-rTXN(-d2).
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